I think a much neglected story about the Iraq war is–who owns the oil now?
I’m not intrested about U.S. reasons for going to war, just curious about international law concerning mineral rights in occupied countries.
Have the Geneva Accord, UN charters, or other international agreements dealt with this subject?
Probably the old aphorism “Posession is nine-tenths of the law” is the most relevant item.
So we own 9/10 of all that oil–or al of it–or…
As a taxpayer I want to be given all of it. We pay good money for the bombs we send over there. I know were also fighting for democracy and freedom, but I want the skinny on the oil.
Well, take a comfortable chair and grab some popcorn, 'cuz this is gonna take some explaining.
Iraqi oil under the quasi-Stalinist Baathist dictatorship was nationalized in 1972. It was considered a state-owned asset and a state ministry managed it.
After Hussein’s overthrow, the Coalition Provisional Authority under the leadership of Paul Bremer enacted a number of fiats, of which Order #39 decreed the privatization of nearly 200 Iraqi state industries (excluding oil extraction), and permitted 100% foreign ownership of companies in Iraq, including 100% expatriation of profits made by those companies in Iraq. However, it’s been argued that this Order violates international law (the Hague regulations) which requires an occupying power to respect a country’s existing laws. Privatization of state enterprises was forbidden under the previous Iraqi constitution.
Under the current transitional government, the CPA Orders are still in effect (legal or not), so Iraqi oil technically remains national property. Privatization appears to be on the table, though, according to the statements made last December by Iraq’s then finance minister (currently vice-president) Abdel Mahdi at a Washington meeting of the US-Iraq Economic Commission. Mahdi explained that the interim government was looking at a range of options for privatizing the oil industry: “I think this is very promising to the American investors and to American enterprises, certainly to oil companies,” he said. The transitional government elected last January is presumably still considering these options.
Under the draft constitution to be voted on this month, it’s not exactly clear what the formal status of oil assets would be. Article 109 of the constitution says that “oil and gas is the property of all the Iraqi people in all the regions and provinces,” but doesn’t explicitly specify state ownership or management. Articles 25 and 26 say that “the state shall guarantee the reforming of the Iraqi economy according to modern economic bases … diversifying its sources and encouraging and developing the private sector.”
Some have interpreted this as meaning that oil would be privatized under the Iraqi constitution if it’s accepted. There is a good deal of popular opposition to privatization: in late May 2005, the General Union of Oil Employees organized a Conference on Privatization in Basra, which issued a strong resolution against privatization of oil or other state-owned industries. And significant foreign ownership of Iraqi oil assets or extraction enterprises, particularly by US companies, would be bad PR with many Iraqis, many of whom already allege that the overthrow of Saddam Hussein was just the pretext for an oil grab.
So. Does that answer your question?
Oh I do hope this is you being “jocular” ;")
The one thing Kimstu didn’t mention was that virtually all of Iraqi government revenue comes from oil sales. There’s no question at all that Iraq owns the oil.